14 October 2025
If you are covering the latest UK labour market statistics, please see the following comment from Richard Carter, head of fixed interest research at Quilter Cheviot:
“The latest statistics from the Office for National Statistics show some significant cracks are forming in the UK labour market, with yet another slowdown in September. With the Budget looming, this is likely to continue. Higher national insurance costs have placed a significant burden on businesses already this year, so they will likely hold off on any major hiring plans until they know with certainty whether any further changes lie ahead.
“Payrolled employees dropped by 93,000 between August 2024 and August 2025, but saw a slight increase of 10,000 (0.0%) between July and August 2025. The unemployment level also rose slightly to 4.8%. Early estimates for September reveal the number of payrolled employees was 30.3 million, 0.3% lower than September 2024 and equivalent to 100,000 less employees.
“On a monthly basis, initial estimates show the number of payrolled employees decreased by 10,000 in September compared to August. However, the ONS has made several revisions to its data in recent months, and this month has proven no different. August’s early estimate has been revised up slightly, and the same revision warning has been applied to today’s figures so time will tell just how accurate they are.
“The Bank of England opted to hold interest rates at 4% at its latest monetary policy meeting, and the same is expected of its meeting next month. It will continue to keep a close eye on the various data sources, and wage growth – particularly the impact it has on inflation – will be key to its decision making. This month, annual growth in regular earnings excluding bonuses saw another slight decline to 4.7% compared to 4.8% last month, but total earnings including bonuses continued to climb, rising to 5.0% compared to 4.7%.
“Still high wage growth adds pressure to what is already a tricky balancing act for the BoE, particularly with the labour market generally weakening. However, should the jobs data come in cooler than expected in the coming months, the Bank may be pushed towards another cut before year end.”
